Bitcoin Information and FAQ

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Bitcoin General FAQs

Remember, you do not have to purchase a full bitcoin. You can purchase a tenth of a bitcoin (0.1) or any other fraction. You can buy them online or in person. (We have more information about earning bitcoins or mining bitcoins). To buy bitcoins: CoinBase is an exchange based in the USA, but can be used…

What are bitcoins? Bitcoins are the unit of currency of the Bitcoin system. Bitcoin is like email for money. Imagine you can send money over the internet directly to an email address to anyone, anywhere in the world nearly instantly. Bitcoin allows that. Bitcoin is a new way for people to consensually trade value without trusted…

The Bitcoin Directory has a list of many bitcoin related businesses. WordPress.com, Reddit, OkCupid.com, Namecheap domain registration, and others accept bitcoin for payment. If you run a business you can accept business easily using something like BitPay or Coinbase.

Yes, bitcoins are divisible. Currently bitcoins can be divided down to 8 decimal places, which means 0.00000001 BTC is currently the smallest amount possible. Smaller divisions are possible by changing the data structures which store bitcoins. So in practice bitcoins are practically infinitely divisible.

Q: Is Bitcoin a ponzi scheme? A MLM scheme? Pyramid? Bubble? A: What is a Ponzi scheme? A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from existing capital or new capital paid by new investors, rather than from profit earned by the individual or organization running the operation. Operators…

Q: What happens to lost coins? Should bitcoins be destroyed if unused? A: Lost bitcoins are just that, lost. There is no way to know if they are really lost or just in a savings account. In reality it solves nothing either since it is easy to move coins once every so often if needed.…

Q: Should There Be Tainted Bitcoins? Should bitcoins be easily trackable? [Should the bitcoin protocol be forked so as to allow the FBI seized bitcoins to be blocked or tainted in use? To block someone else’s stolen coins?] A: No fungibility is critical to bitcoin. Each bitcoin should be equal to every other. In theory…

Q: Should bitcoin be backed by something like bullion? Gold, Silver, Oil, Platinum? A: No. Bitcoin is backed by math, miners, and the protocol. Some problems with having a backing: Having something “back” bitcoin means that there has to be someone who is holding the something that is backing bitcoin. The person who is holding…

What are some benefits of bitcoin? Nearly instant transfers worldwide Free or very low cost transfers worldwide As of December 2013, bitcoin is accepted at over 15,000 businesses (see https://bitpay.com). Ability to protect yourself from government seizures of your money as happened in Europe in the Spring of 2013. (Cyprus bank bail-in.) When the authorities in…